Crisis in tourism: the three data that generate great concern in the sector

He tourism suffers a strong crisis in the middle of the economic recession. The sector is closely watching the drop in foreigners vacationing in Argentinabecause our country is becoming more expensive in dollars, as well as the departure of Argentines abroad, while it grows loss of jobs in the industry.

A study of IERAL of the Mediterranean Foundation shows that the gap between the demand for outbound tourism is wideningwhich grew to US$3.9 billion in the first half of 2024and the income of receptivewhich was located in US$2.5 billion. Thus, the balance gave a negative balance of US$1.4 billion.

In this context, it is expected that in the year the demand for dollars for outbound tourism get closer to the US$7.5 billion and the balance could be around a net outflow per US$2.7 billionsince the income from incoming tourism would reach US$4.8 billionaccording to preliminary estimates.

Crisis in tourism: why do Argentines choose to vacation abroad?

Historically, the outflow of dollars from outbound tourism exceeds the income of dollars from incoming tourism..

However, the magnitude of the imbalance increases or decreases depending on the conditions of competitiveness that Argentina has, when it plays very against tourism (it becomes more expensive in dollars), the relationship between residents who travel abroad and non-residents who come to vacation. to the country it can be 2 to 1.

At the moment, the imbalance is not so marked “but a very marked trend of deterioration month by month is evident”says the study.

The ratio between outbound and incoming air tourism in the last three months was 1.37, approaching the parameters of 2019. At that time, the tourism deficit was US$2.6 billion and the outflow of dollars through it was located US$7.85 billion.

“The balance of dollars between outbound and inbound tourism constitutes an additional net demand for dollars that influences the balance of payments and is an especially important aspect for this year in which the government is still improving the balance of the central bank, which is why it turns on warning lights. The greater the imbalance, the worse the performance of the productive sectors associated with the tourism value chain.“, they highlighted.

Crisis in tourism: how the elimination of the PAIS Tax impacts

Another factor that can worsen the crisis in the sector is the elimination of the PAIS Tax in 2025since it currently makes card transactions abroad more expensive. The fact is that this suppression could increase the magnitude of the imbalance, especially next summer.

An indicator that can Anticipating the trend is the rate of internet searches associated with tourism options that Argentines usually choose.. Searches associated with outbound tourism grew at a rate of 54% year-on-year in September, while those for domestic tourism fell 15%. This reflects a renewed interest in tourism options outside the country, to the detriment of tourism in the country.

Crisis in tourism: job loss increases

Tourism activity explains around 7% of the private employment registered in Argentina. However, due to the recession and the drop in sales, the sector faces a loss of jobswhich accumulated is already located in the 2.2% compared to last December. Due to the rise in emissive tourism and the fall in receptive tourism, the productive alert light also turns on for the coming months.

In this sense, they highlighted that if the exchange rate does not offer better competitive conditions and provides incentives for the growth of outbound tourism, as well as the decline in domestic tourism and inbound tourism, it will be vital to accelerate the achievement of cost reductions through other means that allow competitive recomposition, which could be achieved through regulatory reforms or taxes.